| Course | GB533 Salesforce Management |
|---|---|
| Unit | Unit 5 |
| Paper type | Compensation plan proposal |
| Length | About 840 words, 6 pages double-spaced |
| Format | APA 7 student paper |
| School | Purdue University Global |
| Program | MBA |
| Updated | October 2026 |
Free sample paper for GB533 Unit 5
$118,000 at Target, Paid on Gross Margin: A Unit 5 Compensation Plan Proposal for Dental Territory Representatives
[Student Name]
Purdue University Global
GB533: Salesforce Management
Unit 5 Compensation Plan Proposal
[Instructor Name]
[Date]
The distributor, its pay figures and every calculation are composite and illustrative; the sources cited are real.
Plan Summary
Target cash compensation: $118,000 a year.
Mix: 65 percent salary, $76,700; 35 percent incentive at target, $41,300.
Incentive measures: 70 percent on consumables gross margin, 30 percent on equipment gross margin.
Quotas: derived from territory potential as estimated in Unit 4.
Payment: quarterly, within thirty days of quarter end.
Equipment credit: at installation, when the practice accepts the equipment.
Dental organization offices: territory representatives receive full consumables credit for sales to organization-owned offices in their territories under central contracts.
Why These Choices
A 65 to 35 mix. Representatives spend much of their time on service and relationships that do not close sales immediately, such as resolving backorders and training staff on new products. Zoltners et al. (2006) suggest that the salary share should be higher when the salesperson's influence on any single sale is shared with other factors and when nonselling work matters. A mix near 65 to 35 keeps pay stable while making a third of it depend on results.
Gross margin, not revenue. Paying on revenue would encourage discounting to win sales. Paying on gross margin makes representatives share the cost of a discount.
Separate consumables and equipment. Consumables are steady, recurring business; equipment is lumpy. Measuring them separately keeps one strong equipment quarter from masking neglect of consumables.
The Payout Curve
For each measure, the curve pays nothing below 80 percent of quota, rises from half to full target incentive between 80 and 100 percent, and pays an extra 1.5 percent of target incentive for each percentage point above quota, capped at 175 percent of target.
Quarterly target incentive is about $10,325: about $7,228 for consumables and $3,098 for equipment. Quarterly salary is about $19,175.
Worked Quarter 1: Strong
A representative reaches 112 percent of consumables quota and 125 percent of equipment quota after two scanner installations.
Consumables payout: 118 percent of target, about $8,528.
Equipment payout: 137.5 percent of target, about $4,259.
Total for the quarter: salary $19,175 plus incentive about $12,787, about $31,962.
Worked Quarter 2: Weak
The same representative reaches 92 percent of consumables quota in a quarter when a large practice delayed a reorder, and 40 percent of equipment quota because an imaging installation slipped to the next quarter.
Consumables payout: 80 percent of target, about $5,782.
Equipment payout: nothing, since 40 percent is below the threshold.
Total for the quarter: about $24,957.
The weak quarter's drop comes almost entirely from one installation landing on the wrong side of a calendar line, not from anything the representative failed to do.
What the Worked Quarters Show
The consumables measure behaves well: a modest shortfall reduces pay modestly. The equipment measure behaves badly. Because a single installation can move a representative from 125 percent to 40 percent, quarterly equipment payouts swing on timing. If the delayed installation lands in the next quarter and pushes equipment to 160 percent, the cap and the curve mean the representative recovers only part of what was lost.
Kerr (1975) warned that reward systems often encourage behavior they were not meant to, and a quarterly cliff can lead representatives to pull installations forward or push them back to suit their own payouts rather than the practice's schedule.
The Fix: Annual Equipment True-Up
Equipment incentive will still be paid quarterly against quarterly quota, but at year end it will be recalculated on annual equipment attainment, with any shortfall from timing paid in the first quarter of the next year. A representative who reaches equipment quota for the year earns full target equipment incentive regardless of which quarter each installation landed in, which removes the reason to time installations around the calendar.
Specialist Splits
When an equipment and imaging specialist helps close a deal, the territory representative receives full equipment credit and the specialist receives credit under the specialist plan. Double crediting costs the company more than single crediting, but it removes the representative's reason to avoid bringing in help, which the structure analysis in Unit 2 identified as a risk.
Cost
Fifteen representatives at target pay cost about $1.77 million a year. If the average representative reached 105 percent on both measures, incentive costs would rise by about 7.5 percent, about $46,000 across the force, paid out of the extra gross margin that performance produces. Steenburgh and Ahearne (2012) found that frequent payouts and accelerators above quota can lift performance across a sales force, which supports quarterly payment and the 1.5 rate.
Limits
The plan depends on fair quotas; if potential estimates are wrong in some territories, payouts will be uneven. Gross margin data must be reliable at the territory level each quarter, including the cost of goods shipped under dental organization contracts, which are priced centrally and could otherwise distort the territory figures.
References
Kerr, S. (1975). On the folly of rewarding A, while hoping for B. Academy of Management Journal, 18(4), 769-783. https://doi.org/10.2307/255378
Steenburgh, T., & Ahearne, M. (2012). Motivating salespeople: What really works. Harvard Business Review, 90(7/8), 70-75.
Zoltners, A. A., Sinha, P., & Lorimer, S. E. (2006). The complete guide to sales force incentive compensation: How to design and implement plans that work. AMACOM.
The Purdue Global GB533 Unit 5 instructions
In GB533 Unit 5 you propose a compensation plan for salespeople. Summarize the plan: target pay, salary and incentive mix, measures and weights, quota basis, payment timing and crediting rules. Justify each choice by the role's work and the company's goals. Describe the payout curve exactly, then run one person through a strong and a weak period with every calculation shown. Ask what the worked periods reveal about the plan's incentives, and fix any flaw they expose. Address shared credit with other roles, estimate the plan's cost at and above target and note its limits. Expect about six pages with a summary box, a payout curve and two worked quarters, citing compensation sources in APA 7.
How the GB 533 Unit 5 example is put together
The summary box sets target pay, the 65 to 35 mix, gross margin measures, potential-based quotas and quarterly payment. A section justifies the mix, citing Zoltners, Sinha and Lorimer on salary share, and the choice of margin over revenue. The curve is described, with quarterly targets of about $7,228 and $3,098. Worked quarter one reaches 112 and 125 percent; worked quarter two reaches 92 and 40 percent, and the highlighted sentence traces the drop to one slipped installation. Kerr's warning about rewards supports an annual equipment true-up. Specialist splits remove the reason to avoid help, and costs at 105 percent attainment are estimated, citing Steenburgh and Ahearne on accelerators.
GB533 Unit 5 rubric: what earns full points
A GB533 compensation proposal is credited for calculations a reader can follow and for fixing what the worked examples expose. A complete plan summary earns early credit. Justifying the mix and measures by the role's work shows understanding. An exactly specified payout curve allows checking. Worked quarters with every step shown carry significant weight. Recognizing that a measure swings on timing rather than effort, and fixing it, shows judgment. Crediting shared deals so that representatives seek help shows alignment with the structure. Cost estimates and limits complete it. Zoltners and colleagues on incentive design, Kerr's classic warning about misdirected rewards, and Steenburgh and Ahearne appear in the APA 7 list.
Common GB533 Unit 5 mistakes, and how to avoid them
Many GB533 Unit 5 proposals describe a commission rate and stop, without showing what a salesperson would earn in good and bad periods. Others pay on revenue, which encourages discounting. A common gap is timing: a quarterly measure on lumpy sales can swing on when a deal lands, and the plan should smooth that without removing the incentive. Some writers ignore how pay interacts with specialists. Summarize the plan, justify each choice, specify the curve, work two periods in full, diagnose what they show, fix it, credit shared deals and cost the plan. A year-end true-up is a simple way to keep quarterly pay while removing the reason to time sales around the calendar.
Get a GB533 Unit 5 example written to your instructions
Plans are tested by running a person through them, so send the pay levels your GB533 case gives, the sales measures in use and the Unit 5 prompt and rubric. The custom proposal works a strong and a weak period to the dollar and names the behavior each feature invites. First one free, 24-48h. The paper above is an original model document written by our desk, not a submitted student paper and not an official Purdue University Global document.
More GB533 papers and MBA samples
- GB533 Unit 1: Discussion Board Post
- GB533 Unit 2: Sales Force Structure Analysis
- GB533 Unit 3: Workload Sizing Model
- GB533 Unit 4: Territory Design Plan
- GB533 Unit 6: Seminar Reflection
- GB533 Unit 7: Sales Training Outline
- GB533 Unit 8: Performance Evaluation Memo
- GB533 Unit 9: Pipeline Forecast
- GB533 Unit 10: Sales Management Report
- GB532 Unit 5: Sampling Plan
- GB531 Unit 5: Message Strategy Analysis
- GB530 Unit 5: Positioning Statement
- GB528 Unit 5: Partner Evaluation
GB533 Unit 5 questions, answered
How do I choose between a cap and no cap on incentive pay?
Consider what a cap does to behavior. Once a representative reaches it, further sales earn nothing, which invites delaying orders into the next period. Uncapped plans avoid that but expose the firm to windfalls, such as one enormous equipment order. Many plans handle windfalls with a review clause rather than a cap. Explain the trade-off you chose.
Should the payout example use realistic numbers?
Plausible and internally consistent matters more than realistic. Pick attainment levels for one strong period and one weak one, apply your curve exactly, and make sure salary, incentive and totals add up. If the case gives pay levels, use them. Graders commonly recompute at least one figure, so show each step rather than only the result.
Is gross margin always better than revenue as a sales measure?
Not always. Margin discourages discounting but requires that representatives see cost data and trust it, and some firms will not share margins. Revenue is simpler and may suit products with fixed pricing. Choose the measure that matches what the strategy needs, and state what behavior the alternative would have encouraged.
Where can I find a free GB533 Unit 5 sample paper?
This page carries a full GB533 Unit 5 compensation plan proposal for dental territory representatives, with a plan summary, a payout curve, a strong and a weak worked quarter, an annual true-up and APA 7 references.
Why pay on gross margin rather than revenue?
Paying on revenue rewards a representative for winning a sale at any price. Paying on gross margin makes the representative share the cost of a discount, which protects the company's profit.